What is the Business Case for the Lear Theater?
The costs to restore have been estimated, but the city is going round on the business case. How would the Lear pay for itself, who would occupy it? Or should we build apartments?
Aug 09, 2026
The Lear Theater has sat vacant on the banks of the Truckee River since 2002, shuttered after just a few short years as a performance space. It was a church built in 1939, but the congregation gave it up in 1997 because they could no longer afford it.
In the decades since, multiple groups have tried and failed to raise the millions needed to restore it, from Lear Theater, Inc. in the early 2000s, to Artown’s abandoned RFP in 2018, to the City of Reno’s promises after acquiring the property in 2023.
Each attempt has stalled, leaving the building to deteriorate. Now we have a new round of studies and proposals. The future of the Lear is once again at a crossroads almost 1 year after the last round.
The City Council is requesting an RFP and getting another study, and they have set a timeline for these actions. This new timeline lays out the sequencing for the two directives that City Council approved last spring:
Issue a Request for Proposals for the property (decided in April)
Dedicate $2 million in Redevelopment Agency funding to some basic exterior improvements for the property (decided in May)
You can read the Barber Brief article for details on the current action. Alicia Barber and councilmember Naomi Duerr appear to be the Lear’s biggest proponents and are promoting this new round of activity, trying to save this abandoned property.
A solid course of action for Reno's Lear Theater
13 days ago · 13 likes · Alicia Barber
Throughout this time, from 2002 until now, costs to restore the Lear have been considered, but not the business case. If the Lear were restored, how would it pay for itself? This question has not been answered since 2002 despite the many efforts.
The Question at Hand
Should someone invest $15–21 million to restore the Lear as a community arts and events center, preserving its architectural legacy but requiring ongoing subsidies, or does it make more sense to clear the site for redevelopment into an apartment project with podium parking, ground-floor retail, and 28–32 new housing units similar to 700 Riverside? That is the question that really needs to be considered.
💸 Financial Reality of the Lear
Capital cost: Every credible study (2013-2024 Historic Structure Report) estimates the full restoration cost at $15–$ 21M+.
Operating income potential: Even with aggressive rentals (weddings, banquets, arts events), the building might gross $300k–325k/year.
Operating costs: Staff, utilities, insurance, and maintenance could consume $250k–$ 350,000 per year.
Bottom line: At best, the Lear breaks even; more likely, it requires annual subsidies and ongoing fundraising in the range of $1 to $2 million.
📉 Why the Business Case Fails
Repeated fundraising failures:
Lear Theater, Inc. (late 1990s–2000s) could not raise the $10M needed.
Artown’s 2018 RFP collapsed when Sierra School of Performing Arts couldn’t secure capital.
Competition:
Reno already has venues at the Pioneer Center, Brüka, Good Luck Macbeth, Reno Little Theater and at UNR.
Livingstones Church has bought the Riverside Century Theaters, which are being converted for religious and community uses, possibly a theater.
The Lear doesn’t offer the scale or amenities needed in the market.
High rehab risk:
Historic standards, ADA, seismic, and mechanical upgrades all add complexity.
Cost overruns are highly likely, especially in a 1939 concrete/masonry structure.
Revenue ceiling:
Community arts/events venues don’t generate the margins that justify $20M+ of capital.
Donor fatigue: Reno’s philanthropic pool has already funded the Discovery Museum, NMA expansion, Auto Museum, etc.
🔑 Conclusion - the Lear is not viable and needs subsidies
The Lear Theater is not financially viable as a stand-alone business case. As a cultural preservation project, it could possibly survive with subsidies, grants, or a “Friends of the Lear” nonprofit, but where are the donors? It’s been more than 20 years, and none have appeared.
🏢 Financial Reality of Developing Apartments
Capital cost: A proportional build on the Lear lot would run approximately $14 million all-inclusive (including demolition and abatement, podium parking, two complete residential levels, and a partial third).
Operating income potential:
28–32 units (≈800 sf avg) = ~22,000–25,000 sf rentable.
At ~$2.40/sf rents, annual gross = $1,505k–1,966k.
Add ~3,000–4,000 sf retail (~$28/sf/yr) = $85k–110k.
Add podium parking (20–25 stalls at $75/month) = $20k/year.
Total estimated income ≈ $1,610k–2,096k/year.
Return on investment: With operating expenses at ~33%, NOI comes in at around $1,078k–1,404 per year.
On ~$14M cost, that’s about an 8.0%+ net yield.
📉 The Business Case for Apartments
Marginal yields: 8% or so is above the 5–6% developers usually require for new multifamily with premium rents, so it is financially viable.
Entitlement hurdles:
The site is zoned Public Facility and has a Historic Landmark overlay.
It would require rezoning, HL removal, and Council approval to sell or lease.
Parking constraints: A podium could accommodate ~20–25 stalls, with lighting for 30 units without requiring variances or shared-parking agreements.
Market competition: 700 Riverside has captured premium renters at its nearby location, and the Lear at 501 Riverside has a desirable corner location on Ralston, across from Bicentennial Park, and is closer to downtown.
🔑 Conclusion - apartments are the highest use case
An apartment redevelopment of the Lear parcel (≈28–32 units + retail + parking podium) could produce:
~$1078k–1,404k net income
On ~$14M cost = ~8% yield
This is financially stronger than restoring the Lear Theater (which has a negative ROI), and falls within the threshold for a solid private business case.
Final Thoughts
In the end, the choice comes down to pragmatism versus sentiment. Converting the Lear lot into housing along the lines of 700 Riverside is the more practical option: it generates reliable revenue and property tax, adds needed downtown apartments, and avoids saddling the City with another costly facility.
The sentimental option — restoring the Lear — carries a different weight. It honors Reno’s history, preserves a rare Paul Revere Williams design, and fulfills the original vision of a community gathering place on the river. One path is financially sound, the other culturally significant.
The community will have to decide which value matters most and can be achieved. What would you do?
Do you have a story to tell? Write to me at: mike@mikesrenoreport.com
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